October was a challenging month for stocks as the S&P 500 ended the month down about 2%, leaving stocks up roughly 9% for the year. Bonds also faced some headwinds as the 10 Year Treasury Yield rallied, crossing 5% for the first time since 2007. (YCharts)
Understandably, we’ve had a lot of questions about the recent volatility. Today we will address 3 of the most common topics:
- Interest Rates – Interest rates have jumped significantly this year, but the economy has managed to digest higher rates with GDP growth hitting 4.9% in the 3rd quarter. The future direction of rates is important as significantly higher rates could put pressure on economic growth and stocks. Inflation, Fed policy, and economic strength are three factors that we’ll be watching closely.